scholarly journals Bank Lending Technologies and SME Credit Rationing in Europe in the 2009 Crisis

2014 ◽  
Author(s):  
Giovanni Ferri ◽  
Pierluigi Murro ◽  
Zeno Rotondi
Keyword(s):  
Credit Rationing ◽  
Bank Lending ◽  
Lending Technologies

scholarly journals Firm Funding and Investment under Bank Credit Control Policy: Evidence from China

2021 ◽  
pp. 101-134
Author(s):  
Xiaochen Fu
Keyword(s):  
Trade Credit ◽  
Control Policy ◽  
Credit Rationing ◽  
Bank Lending ◽  
Jel Classification ◽  
Bank Loans ◽  
Level Data ◽  
Amplifying Effect ◽  
Financing Gap ◽  
Regulatory Commission

Using the 2014 China Banking Regulatory Commission (CBRC) credit control policy as a quasi-natural experiment, this paper demonstrates that credit supply contraction leads to a significant reduction in firm’s external funding, cash holding, and investment. Analysis of both loan-level and corporate-level data reveal that new bank loans issuance of targeted firms dropped significantly after the regulation. State-owned banks are identified as the main policy implementer. By instrumenting the change of loans issuance with the policy shock, I further discover the amplifying effect of large declines in bond issuance and trade credit for the targeted firms. Cash holdings were used to cushion the financing gap. Investment dropped and inefficient investment increased due to the shock. Interestingly, whereas such impacts were significant for non-state owned enterprises, state-owned enterprises (SOEs) were barely affected. Overall, I conclude that the lending control policy led to less capital resources allocated to non-SOEs but not SOEs. JEL classification numbers: G21, G28, G32, G38. Keywords: Bank lending, Firm funding, Firm investment, SOBs, SOEs, Credit policy, Credit rationing.

scholarly journals Bank lending technologies and credit availability in Europe: What can we learn from the crisis?

2019 ◽  
Vol 95 ◽  
pp. 128-148 ◽  
Author(s):  
Giovanni Ferri ◽  
Pierluigi Murro ◽  
Valentina Peruzzi ◽  
Zeno Rotondi
Keyword(s):  
Bank Lending ◽  
Credit Availability ◽  
Lending Technologies

Small Business Lending

2019 ◽  
pp. 430-469
Author(s):  
Allen N. Berger ◽  
Lamont K. Black
Keyword(s):  
Small Business ◽  
Small Businesses ◽  
Technological Progress ◽  
Global Financial Crisis ◽  
Bank Lending ◽  
Relationship Lending ◽  
Small Business Lending ◽  
Credit Supply ◽  
The Global Financial Crisis ◽  
Lending Technologies

Small businesses are engines of economic growth that are fueled in large part by bank lending. We examine the roles of technology and regulation in the supply of small business credit. Technological changes increase small business credit supply through the adoption of new hard-information-based lending technologies, such as FinTech lending, as well as by improving existing lending technologies. Technological progress has more modest effects on the processing and transmission of soft information used in relationship lending. Regulatory changes, such as pre-crisis deregulation and post-crisis reregulation, directly affect bank small business lending. The combination of technological progress and geographical deregulation also has resulted in more bank consolidation and competition, both of which have mixed effects on small business credit supply. Lastly, we cover the challenges and mitigating factors in explaining the dramatic drop in small business credit availability during the Global Financial Crisis and the very slow growth during the subsequent recovery.

scholarly journals Small, micro and medium enterprises financing: Costs and benefits of lending technologies in the Eastern Cape province of South Africa

2020 ◽  
Vol 13 (1) ◽  
Author(s):  
Edson Mbedzi ◽  
Munacinga Simatele
Keyword(s):  
South Africa ◽  
Small Businesses ◽  
Black People ◽  
Credit Rationing ◽  
Eastern Cape Province ◽  
Eastern Cape ◽  
Access To Credit ◽  
The Government ◽  
Medium Enterprises ◽  
Lending Technologies

Orientation: As lack of access to credit hinders small, micro and medium enterprises (SMMEs) success and lending technologies being conduits transmit credit access, more focus must be on the effect of lending technologies on credit rationing.Research purpose: To analyse the extent of credit rationing amongst SMMEs based on lender and firm characteristics.Motivation for the study: In South Africa, SMMEs are funded by different lenders using different lending technologies, but little is known about which ones are more effective.Research approach/design and method: The study takes a quantitative approach. In this study, 321 SMMEs are sampled from 1486 small businesses on the registers of the Nelson Mandela Bay Business Chamber and the Border-Kei Chamber of Business in the Eastern Cape province of South Africa. Financing of SMMEs is captured with a categorical credit-rationing variable. Accordingly, a logit technique is used. The first model captures credit rationing as a binary variable. In the second model, the nature of credit rationing is disaggregated resulting in a four-measure categorical variable.Main findings: Little rationing occurs when asset-based and venture capital methods are used. Microfinance and privately owned development financial institutions have high rationing levels, similar to commercial banks, defeating the purpose of their special existence to address excluded groups. Black people-owned and female-owned businesses are the most rationed. Credit rationing decreases with firm size, but the effects are amplified by race.Practical/managerial implications: To improve SMMEs access to finance, the government should focus on allocating funds to firms using SMMEs’ credit rationing risk profiles.Contribution/value-add: Lending technology, lender type and SMME characteristics relationships indicate that SMMEs can benefit from a well-understood rationing risk profile of firms in the economy. Therefore, policies on support and regulation of the distribution of loan portfolios aligned to empirical rationing risk profiles can improve SMME growth. However, this study has used SMME data from the Eastern Cape province only, one of the nine provinces in South Africa. Thus, the provincial heterogeneity effects are not captured in this study.

scholarly journals Foreigners vs. Natives: Bank Lending Technologies and Loan Pricing

2018 ◽  
Vol 64 (8) ◽  
pp. 3792-3820 ◽  
Author(s):  
Thorsten Beck ◽  
Vasso Ioannidou ◽  
Larissa Schäfer
Keyword(s):  
Bank Lending ◽  
Loan Pricing ◽  
Lending Technologies

Agrarian receipts as a tool for the structural transformation of financial and credit relations in the agrarian business of the region

2019 ◽  
pp. 40-53
Author(s):  
Yuliia Nehoda
Keyword(s):  
Comparative Analysis ◽  
Retrospective Analysis ◽  
Structural Transformation ◽  
Pilot Project ◽  
Bank Lending ◽  
Economic Benefits ◽  
Advantages And Disadvantages ◽  
New Instrument ◽  
Agricultural Business ◽  
Business Entities

The subject of the research – is a set of organizational-economic relations arising in the process of structural transformation of financial and credit relations in the agricultural business. The purpose of the article is a retrospective analysis of structural transformations of financial and credit relations in the agricultural business, evaluation of the effectiveness and feasibility of the introduction of agricultural receipts as a new instrument of lending to the agricultural business of the regions. Methodology of work – system-structural and comparative analyzes (to determine the effectiveness of the crediting mechanism according to the agricultural receipts of the farmers of the region); monographic (when studying the problems of the functioning of the mechanism of lending to agrarians by agrarian receipts) economic analysis (when carrying out a comparative analysis of the mechanism of classical bank lending to the agrarian business and the mechanism of lending to agrarians according to agrarian receipts); modeling and forecasting (when determining ways to overcome the existing deficiencies in the mechanism of lending to agrarian business entities of the region according to agrarian receipts). The results of the work – a retrospective analysis of the structural transformation of financial and credit relations in the agricultural business was carried out. The mechanism of crediting agrarians according to agrarian receipts and the scale of its distribution in the agrarian business of the region are considered. A comparative analysis of the mechanism of classical bank lending to the agrarian business and the mechanism of lending to agrarians according to agrarian receipts was carried out. In the framework of the pilot project “Agrarian receipts in Ukraine” of the international financial corporation (IFC) in partnership with the Swiss Confederation in Ukraine, the example of the Poltava region defined the effectiveness of the crediting mechanism according to the agrarian receipts of the agrarians of the region. The advantages and disadvantages of the mechanism of crediting the subjects of the agrarian business on agrarian receipts are noted. The ways to overcome the existing shortcomings of the mechanism of crediting the subjects of the agrarian business of the region according to agricultural receipts are determined. Conclusions – according to the results of the conducted research, the effectiveness of the mechanism of lending to the agricultural business of the regions according to agricultural receipts was proved, its advantages and disadvantages were noted, and attention was also focused. Proposed in Art. 7 of Law No. 5479-VI clearly delineate cases and restrictions on the debtor’s reimbursement of expenses incurred by the lender with the acquisition of the right to grow and harvest the pledged crop of agricultural products, which will ensure the principle of equality of parties on economic benefits and distribution of credit risks according to agricultural receipts.

World Bank Lending for Small Enterprises, 1989-1993

1996 ◽  
Author(s):  
Leila M. Webster ◽  
Randall Riopelle ◽  
Anne-Marie Chidzero
Keyword(s):  
World Bank ◽  
Bank Lending ◽  
Small Enterprises
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